The innovative atmosphere of FirstStreet is hard to miss. Spend a few moments gazing at a product display of, say, a pocket-sized video player or a TV watch, and the smiling image of a live chat agent will begin scrolling across the page offering personal service. Like its products, the site itself is designed to bring innovation to shoppers.

"The floating live chat is a cool feature, it`s unique," says Neil Stern, senior partner with retail consultants McMillan/Doolittle, adding that FirstStreet`s product line needs the support of thorough descriptions and responsive customer service. "They do a good job of promoting live chat to help explain products."

Like its live chat feature, the retailer itself isn`t sitting still. "We`re constantly working to improve our site and make it more fun and helpful," says Anne Richardson, director of Internet.

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A unit of TechnoBrands Inc. formerly known as TechnoScout.com, the site re-launched in July with its new name and a mission to broaden its customer base. For long a retailer of technical gadgets like a laser-beam device that shows how far to pull a car into a garage, the old site appealed predominantly to men. Now, with a brand that combines a "you-saw-it-here-first" attitude with the image of a shopping mall, FirstStreetOnline.com is designed to appeal to more women.

A new home-and-garden category, for example, offers products like self-extinguishing rope candles and outdoor electric kettles for deep-frying turkeys.

But FirstStreet is also making shopping easier. New drop-down navigation menus let shoppers drill down faster to particular products within different categories, and the shopping cart now provides a running view on each page of what a shopper has placed in it. The checkout process has been streamlined. The overall result, Richardson says, is that shoppers take fewer steps to find what they want, and sales conversion rates have gone up.

Since the July relaunch, FirstStreet has reduced its cart abandonment rate. "We`ve noticed that people are getting to where they want to go faster, and our shopping cart abandonment rate has gone down," Richardson says. "About 20% more shoppers who access a shopping cart go on to complete their order."

Like a hip David surrounded by corporate Goliaths, Napster, the one-time bad-boy of digital music, is bringing innovation to one of the web`s hottest markets. "They`re absolutely innovative, they`re building as robust an offering as anyone can," says David Card, vice president and senior analyst with Jupiter Research.

Napster has formidable challenges in the young digital music market. Competing against some of the biggest names in electronic retailing--Apple Computer Inc.`s iTunes, Wal-Mart Stores Inc.`s Walmart.com and Real Networks, to name a few--it`s truly a midget among giants. "But its weakness could also be its strength, because it could be a faster, more nimble company," Card says.

So far, Napster has lived up to that potential. It recognized early that subscriptions to buy digital music would be a popular alternative to purchasing single song downloads, the only option offered by iTunes. "We emphasize the subscription model because we think that is where digital music is going," says COO Laura Goldberg.

And it`s taking bold steps to set itself apart. This fall it launched Napster to Go, the first subscription service that lets customers buy songs and play them on a portable device. What`s more, it introduced with AT&T; and Audiovox the first service that lets subscribers carry their music around on a cell phone.

Napster`s market innovation also extends to the fundamentals of marketing and merchandising. Its introduction of gift cards and Napster-branded merchandise, including blank CDs and CD cases, in Best Buy, Target, Radio Shack and other stores has given it a strong multi-channel presence. "You can go into 30,000 retail stores and buy a prepaid Napster card," Goldberg says.

While other digital music retailers offer products like videos and games, Napster is sticking to a clear message about serving the digital music market, Goldberg adds. "Having a clean, succinct message has helped us a lot," she says. It is making that message clearer by divesting its software business and focusing on Napster, even changing its corporate name from Roxio to Napster.

The former bad boy also avoids pushy sales. "We have a user-friendly web site that lets users find what they want before having to commit to a purchase," Goldberg says.

When Netflix Inc. arrived on the DVD rental scene a little over five years ago, it didn`t take long to win loyal customers. Revenue is closing in on $500 million this year, nearly double the $272 million of 2003. "What we`re seeing in online DVD rentals is a rare phenomenon," boasts CEO and founder Reed Hastings.